He wants the revenue to save a program that provides money to people unable to work because of physical or mental disabilities.

The General Assistance-Unemployable program would be cut in the budget proposed by Gov. Chris Gregoire.

The legislation would tax adult magazines and video, telephone services and paraphernalia.

The tax would need a supermajority vote of the Legislature or approval by voters. Miloscia told The Spokesman-Review he’s confident his proposal would pass if it went to a statewide vote.

I think this is a terrible idea for 3 reasons:

You’re taxing a specific kind of speech. Why not single out action movies or picture books for a tax? It’s not even the medium that defines what is being taxed in this proposal, just the content.

A program that depends on revenue from porn taxes is a program that depends on the flourishing of the porn industry, not exactly I goal I think lawmakers in Washington State have in mind. Here in Oregon, a distressing amount of our money comes from the lottery and from video poker machines, and as a result, the government rolls over instantly whenever the gambling industry asks us for anything.

It creates an inappropriate stigma. Gasoline taxes are often used for road repair because the costs and benefits stay within the same group (people who use roads). What is the connection between porn and the difficulty of people with disabilities to find employment? As someone with a learning disability, I benefit from school and government considerations all the time; society as a whole benefits when all are able to succeed regardless of circumstance, so I’m not sure why consumers of pornography should be singled out to pay.

In short, I see no reason why we should tax porn-consuming Peter to pay disabled Paul; it’s mean-spirited, it’s opportunistic, and it’s offensive. I support these kinds of government programs and wish the taxes would be spread among those who benefit (everyone), rather than targeting a specific group for no reason.

Update:It died. One reason cited is that a fellow state senator “foresaw problems with a bill that would put a different sales tax on goods based on content.” I believe the legislative term for this is “no sheezy.”

It may very well be that a higher tax on sugary soda would shrink Empire State waistlines as it fattens Albany’s coffers. But what ultimate price, in terms of individual freedom, shall we pay if the state starts dictating our dietary and lifestyle choices?

Using the rubric of better overall health as a “sweetener” for government intrusion in citizens’ private lives could damage our liberties in the same way that high-fructose corn syrup may have had on our body-mass measurements.

I’m happy to have government give me information with which I can make informed decisions, but let the choice be mine — untaxed and unfettered, please.

Mark A. Kellner
Columbia, Md., Dec. 18, 2008

I may have mentioned this before (I don’t remember), but John Stuart Mill had a few things to say on this in his essay, On Liberty. He spends good chunks of the essay condemning government attempts to limit individual choice, even bad choices, if they do not affect others. But, on the subject of vice taxes (see chapter 5, paragraph 9), he notes that governments have to raise money, that taxes are best levied on items that are nonessential, and that a vice is, by definition, nonessential. If it’s actively harmful to us, it’s something we can spare from our budgets, and therefore a good option for a tax.

As it happens, government actively subsidizes candy and fast-food through our ridiculous farm subsidy system, and a subsidy is a reverse tax. Government already influences our nutritional habits, and the question is whether or not they’re doing so in good faith.

October 22, 2008

Paul Krugman opines that the next president will have to do some serious spending, putting legitimate concerns about the budget deficit aside. I agree with him; deficit spending is often the only way out of a slump or a crisis. However, two things annoy me (as I’m sure they annoy him, too):

In order to spend like this during bad times, we need to be sure we save during good times. Today, we can’t just turn back the clock on the Bush years and pretend they never happen. But let’s remember 2000, when Bush kept arguing that the budget surplus should be shredded into tiny pieces to be sent to individual taxpayers, rather than saving it for a time like, oh, now. If we’re willing to spend into debt, we need to be able to hold off on big purchases when times are good in order to pay back that debt, and to save for future crises.

As Fareed Zakaria recently pointed out on The Colbert Report, recently, the further into debt you are, the harder it is to borrow money on good terms. Bush’s tremendous fiscal irresponsibility has hamstrung us at our worst time; $10 trillion of debt means that any country still willing to lend to Uncle Sam is going to offer high interest rates and other unfavorable terms. But, we must avoid whacking Bush like a piñata and remember who it is that bought the snake oil: us, who gave him a narrow enough loss in 2000 for him to be extra-constitutionally appointed President by the Supreme Court.

It was William McChesney, former chairman of the Federal Reserve, who described the Fed’s job as “to take away the punch bowl just when the party gets going.” It hurts, but you need to show restraint when times are good, and instead, Alan Greenspan slashed interest rates and told us all to gamble our livelihoods on dodgy mortgages. In the end, we all listened, grabbing the punch bowl with both hands and chugging furiously. We should all have regrets now that we could really use some of that punch.

In other words: knowing what could have been done with it—that we could have helped temper this mess, either using it to pay down deficits then or to spend now—does Bush’s $400 handout really seem all that great? And, when the crisis has passed, would you support a candidate who would increase your taxes to help pay down the national debt?

Op-Ed Contributor – To Change Washington, Move Some of the Government Out – Op-Ed – NYTimes.com
Three years ago, I suggested the idea of moving the headquarters of the Internal Revenue Service to New Orleans, thinking that a federal campus there, providing some 7,000 stable, well-paying jobs, could anchor redevelopment after Hurricane Katrina. Such a move could still be a boon to recovery in New Orleans. And the same could be done for regions like the Midwest, where car makers and other industrial employers are contracting.

The best candidates for relocation would be departments like Homeland Security and Veterans Affairs, which are more involved in operating government than in making policy.

Good ideas are supposed to come from Presidential candidates, but sometimes, they just seem to bubble up out of nowhere. I was impressed upon reading this idea. It’s just… good.

The writer also mentions how the prohibitive costs of living in DC deter bright, young professionals from working there. I mean, come on. No offense to the city—all I remember of which from my childhood visit were vendors selling hot dogs for obscene prices outside the Smithsonian, though to be fair, bilking tourists is an international hobby—but would you, given the choice, move to DC? I mean, maybe you would if you wanted a job near the center of power, which is not the IRS. I mean, if I worked for the IRS, I’d want it to be in a city I love. Does anybody love DC?

(People who live in DC are hereby advised to tell me why I shouldn’t be so cynical. A good response will get its own blog post!)

Besides, I can imagine that DC is full of pencil-pushing day jobs. Why not move them away from where there’s an excess, and move them to places where they’re needed? Then again, DC isn’t exactly economically fluorishing. Perhaps these government jobs should move where they’re needed… uh… to DC.

Come to think of it, this has all just fallen apart in my head. If this idea would be a good jobs initiative, why isn’t DC awash in more jobs than it can handle? I looked on Wikipedia and found—in a well-cited article and a section within that uses the Bureau of Labor Statistics and the DC Department of Employment Services as its sources for these facts—that “As of May 2008, the Washington Metropolitan Area had an unemployment rate of 3.5%; the lowest rate among the 40 largest metro areas in the nation. It is also lower than the national average unemployment rate during the same period of 5.2%.” (source here, PDF) And yet, the rates within the city vary wildly: “in May 2008, unemployment ranged from 1.7% in affluent Ward 3 in upper Northwest D.C. to 17.2% in poorer Ward 8 in Southeast.” (source here, PDF) So, DC has a lot of jobs, but they aren’t spread out very evenly. Of course, I need to know (sadly) if that’s unusual for a US city, and where the problems are.

So, maybe DC should be sending some of its jobs into different areas. Obviously, though, they wouldn’t want to hire unqualified people simply to improve a neighborhood’s beleaguered economy; on the other hand, what if the people in the poor areas are caught in a cycle of poverty and poor education? What if they’ve worked hard and played by the rules and still come up short? I don’t know any of that. I like to boast about my first-year economics education (mainly, it serves to make me sad that so many world leaders and at least one candidate for President—hint: the old guy, who favors drilling and does not understand that introducing slightly more oil into the international market after a ten-year wait will have no effect now and a negligible one then), but I can’t tell you jack-squat about how to measure the availability of jobs across communities and how discrepancies typically come about (other than the usual scientific advice of “take everything in context”).

This is (wow, I’m on a tangent) all part of why I feel it would be excellent for all government data to be available in easily-interoperable data markup formats, like XML, that would encode the results and methodology of all government surveys in a uniform way. Then, armchair sociologists like me could have a go at the data and detect trends that even the most hard-working member of the Beltway fishbowl might miss. And, economic policies of politicians would have to stand up to serious scrutiny from citizens, able to see every direct and indirect effect in its full context. So, we’d get to see how the effects of bold plans—like, say, moving the IRS to New Orleans—would play out in cold, hard, interoperable data.

(That’s a suggestion to government web designers everywhere: just give us the data! We’ll get to work right away on doing cool things with it. Right-o!)

Op-Ed Columnist – Flush With Energy – Op-Ed – NYTimes.com
Unlike America, Denmark, which was so badly hammered by the 1973 Arab oil embargo that it banned all Sunday driving for a while, responded to that crisis in such a sustained, focused and systematic way that today it is energy independent. (And it didn’t happen by Danish politicians making their people stupid by telling them the solution was simply more offshore drilling.)

What was the trick? To be sure, Denmark is much smaller than us and was lucky to discover some oil in the North Sea. But despite that, Danes imposed on themselves a set of gasoline taxes, CO2 taxes and building-and-appliance efficiency standards that allowed them to grow their economy — while barely growing their energy consumption — and gave birth to a Danish clean-power industry that is one of the most competitive in the world today. Denmark today gets nearly 20 percent of its electricity from wind. America? About 1 percent.

And did Danes suffer from their government shaping the market with energy taxes to stimulate innovations in clean power? In one word, said Connie Hedegaard, Denmark’s minister of climate and energy: “No.” It just forced them to innovate more — like the way Danes recycle waste heat from their coal-fired power plants and use it for home heating and hot water, or the way they incinerate their trash in central stations to provide home heating. (There are virtually no landfills here.)

1) For the duration of the energy crisis, oil companies will be limited to making “reasonable” profits, wherever we can manage to set it. (I say bargain hard; we don’t have to worry about them not fighting back hard enough to save a reasonable profit for themselves, given the influence they weild on the Hill.)

2) Oil companies say that the change will have the unintended effect of discouraging excavation and production, which could in turn raise gas prices. (Unintended consequences are a bitch, and common in the blunt and rusty world of law, but I’ve always been wary of any “but it will have the opposite effect!” argument, even if it is sometimes true.)

The problem is, if I have my basic economics right, profits are revenue minus expenditures; that is to say, what you earned minus what you spent. This is to make sure that the oil companies are actually spending the money on improving their operations (incentives are offered to invvest in clean energy, for instance), rather than simply hoarding it for a far-off rainy day while Americans are hurting now. It’s similar to how we require charities to spend at least five percent of their endowments each year (yes, yes).

So, that would put new investment in the “expenditures” category… meaning the windfall tax would encourage, not discourage, it. Basically, it says, if I understand it right, that if the companies don’t take the initiative on investment, the government will. That doesn’t sound like a bad policy at all.

The oil companies’ framing is totally backward. They should invest in a new one.

I have always been weary of a “windfall profits tax” on oil companies, thinking it sounded kind of mean-spirited and shirking our duty of developing alternatives to gasoline (see, that’s the real way to piss off oil companies: don’t buy gasoline). But, this actually sounds fairly reasonable:

Senate debates windfall profits tax on oil – OregonLive.com
The Senate proposal would impose a 25 percent tax on profits over what would be determined “reasonable” and would allow oil companies to avoid paying the tax if they invest the money in alternative energy projects or refinery expansion.

The tax breaks that would be rescinded, given by Congress over the past five years, are expected to save the five largest oil companies about $17 billion over the next 10 years. The Democratic proposal would funnel the money into tax incentives for renewable energy sources such as wind and solar, and to promote energy efficiency and conservation.

I can see why, during an energy crisis, we’d want to mandate that companies spend most of what they make and ensure they’re not merely hoarding their wealth for a rainy day, the same way we require charities to spend at least five percent of their endowments each year (and how we should require the same of universities). We’re not against profits, we just want to ensure the money we’re sending these companies is spent well. Since the government is my only element of bargaining power in these things, I don’t mind having ’em step into the ring for me.

Meanwhile, here’s a familiar refrain:

Most Senate Republicans have a different approach to dealing with the growing energy crisis — pump more oil and gas.

And they say liberals are naïve!

I’ve always disliked this argument:

Oil executives, testifying before Congress last month, called the proposed taxes “punitive” and warned that they would discourage domestic oil and gas exploration and production, possibly causing prices to rise instead of fall.

And, of course, oil executives are powerless in regard to their firm’s excavation decisions. I don’t like it when companies testify before Congress and say, “you can’t do that, it would discourage us from doing this!” That’s what we call a veiled threat, and we might want to call their bluff one of these days.

I just realized the problem here… the argument the oil companies are making is not just disingenuous, it’s nonsense. More next time.